Return on equity is calculated as Net Income attributable to Common Stockholders (Net Income minus the preferred dividends paid) divided by its Total Stockholders Equity. Alphabet Inc's annualized net income attributable to common stockholders for the quarter that ended in Mar. 2019 was $26,628 Mil. Alphabet Inc's Total Stockholders Equity for the quarter that ended in Mar. 2019 was $180,550 Mil. Therefore, Alphabet Inc's annualized return on equity (ROE) for the quarter that ended in Mar. 2019 was 14.75%.

During the past 13 years, Alphabet Inc's highest Return on Equity (ROE) was 20.68%. The lowest was 8.69%. And the median was 16.28%.

NAS:GOOGL's ROE % is ranked higher than
56% of the 349
Companies
in the Global industry.

( Industry Median: 6.33
vs. NAS:GOOGL: 16.39
)

Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

* Premium members only.

Alphabet Inc Annual Data

Dec09

Dec10

Dec11

Dec12

Dec13

Dec14

Dec15

Dec16

Dec17

Dec18

ROE %

14.79

14.12

15.02

8.69

18.62

Alphabet Inc Quarterly Data

Jun14

Sep14

Dec14

Mar15

Jun15

Sep15

Dec15

Mar16

Jun16

Sep16

Dec16

Mar17

Jun17

Sep17

Dec17

Mar18

Jun18

Sep18

Dec18

Mar19

ROE %

24.00

7.92

22.16

20.60

14.75

Competitive Comparison

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap.

Alphabet Inc Distribution

* The bar in red indicates where Alphabet Inc's ROE % falls into.

Calculation

Alphabet Inc's annualized Return on Equity (ROE) for the fiscal year that ended in Dec. 2018 is calculated as

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

In the calculation of annual return on equity, the net income attributable to common stockholders of the last fiscal year and the average total shareholder equity over the fiscal year are used. In calculating the quarterly data,
the net income attributable to common stockholders data used here is four times the quarterly (Mar. 2019) net income attributable to common stockholders data.
Return on Equity is displayed in the 30-year financial page.

Explanation

Return on Equity (ROE) measures the rate of return on the ownership interest (shareholder's equity) of the common stock owners. It measures a firm's efficiency at generating profits from every unit of shareholders' equity (also known as net assets or assets minus liabilities). ROE shows how well a company uses investment funds to generate earnings growth. ROEs between 15% and 20% are considered desirable.

The factors that affect a company's Return on Equity (ROE) can be illustrated with the three-step DuPont Analysis:

Note:
The net income attributable to common stockholders data used here is four times the quarterly (Mar. 2019) net income attributable to common stockholders data. The Revenue data used here is four times the quarterly (Mar. 2019) revenue data. The same rule applies to Pre-Tax Income and Operating Income.

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Be Aware

Net income attributable to common stockholders is used.

Because a company can increase its return on equity by having more financial leverage, it is important to watch the equity multiplier when investing in high ROE companies. Like ROA %, ROE is calculated with only 12 months data. Fluctuations in company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.

Asset light businesses require very few assets to generate very high earnings. Their ROEs can be extremely high.

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